FIRST TWO PARTS OF THIS QUESTION HAS BEEN RESOLVED EARLIER. PLEASE HELP ME SOLVE THE 3RD PART ONLY.Consider the market for solar power. Assume the market is perfectly competitive and initially in long-run equilibrium; solar power sells for $.25 per kwh (kilowatt hour, a unit of power). (resolved) Draw 2graphs, one to represent the market (supply and demand), and one to represent a single firm (demand, marginal cost, and average cost curves). Assume a u-shaped average cost. Show the equilibrium price and the quantity produced by the market (Q) and by each individual firm (q).(resolved) Next, to encourage conservation, Congress taxes all forms of energy EXCEPT solar power, causing an increase in the demand for solar. Show what happens to the market and the firm in the short run; indicate clearly what happens to price, quantity, and profit.What happens to the market and the firm in the long run? Indicate clearly what happens to price, quantity, and profit, for each the market and the firm. Consider the market for solar power. Assume the market is perfectly competitive and initially inlong-run equilibrium; solar power sells for $.25 per kwh (kilowatt hour, a unit of power).RESOLVED 1. Draw 2graphs, one to represent the market (supply and demand), and one to represent asingle firm (demand, marginal cost, and average cost curves). Assume a u-shapedaverage cost. Show the equilibrium price and the quantity produced by the market (Q)and by each individual firm (q).RESOLVED2. Next, to encourage conservation, Congress taxes all forms of energy EXCEPTsolar power, causing an increase in the demand for solar. Show what happens to themarket and the firm in the short run; indicate clearly what happens to price, quantity, andprofit.3. What happens to the market and the firm in the long run? Indicate clearly what happensto price, quantity, and profit, for each the market and the firm.

In the long-run, the demand matches the supply.

Answered: What happens to the market and the firm…

Principles of Economics (MindTap Course List)

8th Edition

ISBN:9781305585126

Author:N. Gregory Mankiw

Publisher:N. Gregory Mankiw

Chapter14: Firms In Competitive Markets

Section: Chapter Questions

Problem 9PA

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FIRST TWO PARTS OF THIS QUESTION HAS BEEN RESOLVED EARLIER. PLEASE HELP ME SOLVE THE 3RD PART ONLY.

Consider the market for solar power. Assume the market is perfectly competitive and initially in long-run equilibrium; solar power sells for $.25 per kwh (kilowatt hour, a unit of power).

(resolved) Draw 2graphs, one to represent the market (supply and demand), and one to represent a single firm (demand, marginal cost, and average cost curves). Assume a u-shaped average cost. Show the equilibrium price and the quantity produced by the market (Q) and by each individual firm (q).
(resolved) Next, to encourage conservation, Congress taxes all forms of energy EXCEPT solar power, causing an increase in the demand for solar. Show what happens to the market and the firm in the short run; indicate clearly what happens to price, quantity, and profit.
What happens to the market and the firm in the long run? Indicate clearly what happens to price, quantity, and profit, for each the market and the firm.

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